It's not whether you're right or wrong that's important, but how much money you make when you're right and how much you lose when you're wrong.Markets are designed to allow individuals to look after their private needs and to pursue profit. It's really a great invention and I wouldn't under-estimate the value of that, but they're not designed to take care of social needs.
George Soros

All of these issues (and many more) can be traced back to one of the biggest challenges struggling entrepreneurs face: a lack of focus.

I call it fuzzy thinking.

Fuzzy Thinking Stems From Neglecting to Acquire Critical Information

Too many entrepreneurs are missing critical information. Not having this information inflicts incredible damage on their chances of success. Because it keeps the path to achieving their dreams out of focus, fuzzy.

And you can't follow a fuzzy path. So they bounce around, get confused, become overwhelmed and attempt to copy what other people are doing... But the path that'll lead them to success still remains out of focus.

What's worse is that most entrepreneurs are not only unaware that this information is absolutely essential... they don't realize it's missing. So they never track it down.

In order to go from fuzzy thinking to focused thinking, you need to know the answers to three questions...

1. What, exactly, do you want?

2. What's the absolute minimum necessary to have it?

3. What's the fastest and easiest way to get it?

Think about it for a moment...

If you knew exactly what you wanted, the minimum necessary to have it, and the exact steps that would get it for you in the fastest and easiest way possible... wouldn't you ALREADY HAVE IT?

Now don't be fooled by the simplicity of this solution. Answering these questions - especially question three - requires some heavy-duty thinking. Nobody can give you the answers. Which is why most entrepreneurs never follow the fastest and easiest path to success: They don't realizethey have to develop it themselves.

When you shift your thinking from fuzzy to focused, you'll know the specific steps you must take to dramatically reduce your efforts, reach your goals faster, and make a lot more money than you do now.
So let's take a closer look at those three questions right now...1. What, Exactly, Do You Want?
How do you define the business success you're seeking?
I rarely meet an entrepreneur who's got a well-thought-out answer to this question. Sure, you want money and freedom. Who doesn't? But what, exactly, do you want your business to do for you, your team, and your customers? And what does that look like? How can it be objectively measured?
If you're unclear about what you're striving for, you pay the price for your fuzziness daily. Why?Because unclear objectives make it impossible for you to know which actions will produce the best results. You can't distinguish between the essential and the non-essential. You can't distinguish between worthless and worthwhile tasks. Without clarity, your day becomes a series of haphazard attempts to deal with symptoms often mistaken for real problems. Symptoms like anemic website traffic, unfinished projects, low conversion rates, etc.
As a result, you're wasting a massive amount of time.
Worse, your chances of success are slim to none.2. What's the Minimum Necessary to Have It?
Once you're absolutely clear about what success in business means to you, you have to be just as clear about what you must do to achieve it.
Because guess what? If you're not sure of what is necessary... you're also not sure of what's NOT necessary.
For example, how many ways do you need to have in order to get new customers? There are so many options that you can't possibly employ them all. So you have to concentrate only on those that are absolutely necessary for you to achieve the business success you desire.
How about converting prospects into customers? Of all the strategies and tactics possible, which ones are vital for you to be victorious in your business-building quest?
How many products do you need? One? Ten? A hundred? How much do you have to sell them for?
If you don't know what is absolutely essential to your success, you're going to wind up going in a million different directions at every turn. And that's one of the main causes of business failure.
To have the business of your dreams, you need to make many decisions. Decisions that require you to: (1) have a general knowledge of what's required, and (2) be familiar enough with your options to choose a few amongst the many alternatives.3. What's the Fastest and Easiest Way to Get It?
Maybe you've already got a clear business goal and you know the minimum necessary to get it. If that's the case, you're almost certainly making progress. But you'd like it if success came faster. Who wouldn't?
There is almost always a shortcut to get from where you are to where you want to be.What it requires is thinking. Not daydreaming. But real mental effort. The type that leaves you exhausted after doing it for an hour or so. And you can't even engage in this level of thinking until you first have your answers to exactly what you want and the minimum necessary to have it.
Think about how different your life would be if you were 100% confident that your answers to the above three questions were spot-on.
Most of the issues you're struggling with right now would disappear.
You'd know exactly what your #1 objective was at all times... You'd know the exact steps you needed to take to immediately move closer to achieving your business goals... And you'd never again struggle with a lack of motivation. Instead, you'd be stoked to get the very next task done... because you'd know exactly what it would do for you.
And all because of knowing: (1) what you want, (2) the minimum necessary to have it, and (3) the fastest and easiest way to get it.
That's how you replace fuzzy thinking with focused thinking.

Boutros Boutros-Ghali's statement that the wars of the 21st century will be fought over water may strike you as absurd. Perhaps ridiculous. After all, most wars of the 20th century were fought over oil.
And our appetite for oil hasn't slowed. All indications are that demand will rise 25% in the next 20 years. But we are actively finding ways to use less oil. And, let's face it, we can survive without oil.
We can't survive without water.
And our demand for it is growing. Over the last 30 years, the US population has grown 36%. But our water demands have tripled. And experts say global demands will double every 20 years.
While our attention has been focused on the world's shrinking oil supplies, the fact is that, unless drastic measures are taken, we will run out of water much sooner.
That's because even though 70% of the earth's surface is covered by water, only 2.5% of that is fresh water. And a scant 1% or so is fit for human use. The remaining 1.5% is in glaciers and ice caps.
We are lucky here in the US to have a fairly consistent supply of fresh water. We can turn on the faucet whenever we want, and it's there. We can shower and use the toilet. It is estimated that each one of us uses an average of 70 to 100 gallons of water every day.
But even in this country, we are starting to face critical shortages. Just a few weeks ago, for example, the reservoirs that provide water to the city of El Paso were on the verge of running out. For at least 24 hours, residents were asked not to shower, wash dishes or clothes, or do anything else that uses large quantities of water. Restaurants were asked to shut down early, and car washes and laundromats were told to close immediately.
Meanwhile, Northern China is experiencing its worst drought in 60 years. The country may lose 2 million hectares of wheat because of it. So far, 391 small reservoirs and 366 rivers have dried up.

Water shortages affect the entire world.
An estimated 1 billion people don't have access to clean drinking water. Another 2.4 billion have "stressed" water conditions. At the rate things are going, by 2025 nearly one-third of the global population won't have adequate drinking water. And by 2030, one-half will face a "fresh water deficit."
Climate change is the cause of some of the problems. But some of it is our fault. People want to live in the desert - in cities like Phoenix and Las Vegas. This requires massive amounts of water to be drawn from other areas.
But the main reason our water supply is threatened is simply population growth. As the global population increases, so does the demand not only for drinking water but for food. And this increases the demand for water to grow the food.
Dietary changes play a major role as well. Look at China, for example. More and more Chinese are adopting a Western diet, which means they eat more meat. And that increases China's water demands dramatically. To grow 1 kg of rice takes approximately 1,550 liters of water. But to "grow" 1 kg of beef takes between 50,000 and 100,000 liters of water.
Water demands are going to be a global issue for years to come. But there is hope. Technology can help alleviate some of the problems.

Joe Lewis... Bruce Kovner... H. Harneker... Dennis Richard. What do these men have in common? They are multimillionaires. But guess what else? Before they became millionaires, they were ordinary people, with very little money to spare. Yet they seized an opportunity to make a lot of money by taking advantage of a special niche that lets you turn $5,000 into $49,600. The details on their incredible rags-to-riches stories are in the special video presentation below. Please watch it as soon as possible. You'll be pleasantly surprised at how easy this method is to use. You could be the next millionaire success story.The "Billionaire's Currency"

This has been a turbulent week on the geopolitical front, triggering waves in the stock market and sending the price of crude oil through the roof. While the stock market corrects itself (as we anticipated), the price of crude oil seems to be creeping ever higher, putting upward pressure on the price of fuel and energy. Worse still is the serious effect this could have on the economic recovery that everyone has been banking on.

A couple of weeks ago I showed you a way you could partially hedge some of your fuel costs with the rise in crude oil prices. But higher gasoline prices at the pump are only part of the problem for most of us. A continued rise in crude oil will wreak havoc on the prices of many things that we need to live and work.

There are three questions I want to address today:

Are prices moving higher?

What the heck is the difference between Brent Crude and West Texas Crude?

How can you profit from a potential move in either?

Where Does Crude Oil Go From Here?

From a technical perspective, you have to be careful here if you are going long. The prices of West Texas Crude(and Brent crude) have almost gone parabolic. A "parabolic" move comes from the mathematical term "parabola," which describes even curvature from a point called the apex.

For us non-math folks who are simply looking at price charts, a parabolic move means the asset (in this case the price of oil) is exploding higher, on increasing volume and in much bigger percentage moves than usual. This is extremely abnormal. Buying anything after its price has "gone parabolic" increases the risk of a sharp pullback in the near term.

The chart formation looks like a bit like a steep parabola; take a look at the shape of the arrow!

The price of crude oil recently jumped from $84 to $100 in about four days; it broke its recent resistance of $92 and exploded on huge volume. A $16 rally in four days is extreme. I know this by looking at the average trading range (ATR), which tells me what the typical movements are. The normal WEEKLY price moves in crude oil are less than $5 -- a third of what we've seen in the past four days. Another factor is that volume is double its recent average.

As for the next move in oil, look for a pullback in the short term, maybe back to the $95 level (we saw a small reprieve yesterday), but with the long-term fundamental demand strong, geo-political unrest in the Middle East and the summer driving season upon us, bet on $120 oil in the next six to eight months.

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Brent Versus West Texas

Now, when we talk about oil, we're mainly talking about West Texas Intermediate (WTI) oil. But there are other types out there, and there seems to be a great amount of confusion (and hype) concerning two specific types of oil: WTI and Brent crude. Let me try to clarify. Recently, Brent crude prices have been higher than WTI, but that is not always the case; there are many factors that can influence the price relationship between the two. Also keep in mind that that prices usually won't get too far apart, because of the ability to ship oil from one place to another to take advantage of prices.

West Texas Crude (WTI for short)

In North America, WTI is traded on the NYMEX under the ticker "CL." It is the most common measurement that we use HERE to track the price of crude oil. It is also considered "light, sweet crude" and is generally refined in and around the Americas. ALL the futures contracts for WTI oil are traded on the NYMEX and all are delivered and settled in Cushing, Okla. There are pipelines and storage tanks in and around Cushing that help distribute and store oil. When there is a glut in storage, prices generally go lower, when there is a big reduction in the amount of oil in storage, prices may go higher.

Brent crude blend prices actually account of two-thirds of the world's oil supply. Most of Brent crude oil comes from the North Sea, hence the name. Brent crude is traded on the ICE (IntercontinentalExchange) and on the NYMEX (Ticker "LO") as well. Brent oil fuels Europe and Asia and is delivered in several areas. Brent provides a pricing benchmark for most of Europe and Asia in the same way we use WTI.

Both WTI and Brent are priced in U.S. dollars

There are actually dozens of different types and blends of oil around the world. WTI and Brent prices are simply popular benchmarks for big oil companies and traders to use. Don't get too caught up in the struggle between the two. Right now, because of Middle East tensions heating up and Canada's oil sands sending supply to Cushing, Okla., the price of WTI is lower than Brent, but they are indeed highly correlated.

How Can You Profit?

The most efficient way to invest in the price of oil is to purchase futures contracts directly. Of course, there are things you need to know before doing so and you must have a futures account and understand the risks.

For those of you who are not ready to start your futures trading career just yet or can't decide if you should buy Brent or WTI, I have a solution. There is an ETF that contains the "pick and shovel" oil companies. These are the guys that get the oil out of the ground and sell it to refiners. If the price of oil (Brent or WTI) is on the rise, these companies are usually following right along. It's called the Oil Services HOLDRS (OIH:AMEX), and you can buy and sell it just like a stock with regular commissions

You should add to your discussion of "Pink Sheet" stocks that they usually have a very large spread between bid and asked prices. A good way for the amateur to get ripped off when either buying or selling.

Another reason to have a care when delving into this area of the market.

Now, let's get down to business. The geopolitical upheaval in the Middle East has levied crude oil prices back up to nearly $100 a barrel, and gold prices above $1,412 an ounce.

We know the psychological reasons for this: Unrest has split Libya in two -- and Libya is a major crude oil-producing country... and a member of OPEC. Economic questions of stability in the Middle East have also sent investors back to the relative safety of gold.

But these two commodities have a relationship -- and one that investors might be able to exploit, if they know what tools to use.

Back in 2005, I stumbled across an article by Adam Hamilton, written in 2004 for ZEAL, LLC, titled, "Gold/Oil Ratio Extremes." It was part of a series that tried to explain some of the big moves in both gold and oil, but more importantly, it found an important relationship between the two.

You should read the article for all the intricate details, but for simplicity's sake, Hamilton shows that historically -- on average -- one ounce of gold buys 15.4 barrels of crude oil.

This is the Gold-Oil ratio.

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What Does the Gold-Crude Oil Ratio Mean?

What this ratio infers is that when the current ratio is below 15.4, gold is either too cheap, or oil is too expensive. When the ratio is greater than 15.4, oil is either too cheap or gold is too expensive, as noted in this InflationData.com chart.

Let me give you an example. Back in the beginning of 2009, crude oil prices were at $34.57 a barrel. Gold prices were at $874.50 per ounce. This means that back in 2009, one ounce of gold bought about 25 barrels of crude oil. That's not on the chart above...

Since then oil prices have nearly tripled, while gold has gained 61%.

Now, 61% is not a paltry gain, but compared to the behavior of oil prices, you can tell which commodity was out of balance within the ratio. The Gold-Oil ratio sits just under 15 as of yesterday.

That's pretty close to the ratio's average... but some investors thing the sharp drop from 2009 could mean gold has room to move higher.

Let's see if this line of thinking makes sense.

Will Gold Prices Push Higher?

Credit Suisse reports, as per Bloomberg:

"We see potential for gold to outperform oil over the coming months," Stefan Graber, Zurich-based analyst with Credit Suisse, said in an e-mailed interview yesterday. "We think an ounce of gold could potentially buy a few additional barrels of oil. This assessment is based on our positive view on gold versus a neutral view on the oil market."

But something's not quite right with his assessment.

Crude oil prices have climbed nearly $12 in the past five days, or 13.6%. Gold prices have climbed $27, or 1.95%. Credit Suisse says that OPEC has spare capacity of more than 5 million barrels a day. And the U.S. has seen its crude inventory climb by 11.4 million barrels over the past year.

It's clear that speculation of supply disruptions has caused oil prices to climb back to $100 a barrel, not actual disruptions.

This could mean -- should no actual disruption occur -- that crude oil prices could drop. So let's try something. Let's take out the oil price rise over the past five days, and see what the Gold-Oil ratio looks like then.

At $1,412 an ounce, and $88 a barrel, the Gold-Oil ratio is 16.04, meaning that crude oil is cheap, or gold is expensive. Slightly...

In other words, the only way gold could climb significantly against oil is if oil prices fall.

Believe me, I'm all for holding gold as an inflation hedge -- even at these high levels, but for gold to close even half the gap in the Gold-Oil ratio difference between 2009 and today, gold prices would have to climb to more than $1,900 an ounce.

For gold to trade for just "a few additional barrels of oil," as Credit Suisse suggests might happen in the coming months, gold would have to climb to $1,700 an ounce.

I don't see that happening in such a short time frame, particularly if oil prices stay at around $100 a barrel.

Using the Gold-Crude Oil Ratio

As I've done here, you can use the Gold-Oil ratio as a "reality check" to some predictions. But you can also use it to see if gold or crude oil is overpriced or underpriced. But it's only the first step in your analysis.

Clearly, when oil prices were trading at $34 a barrel, crude was hugely underpriced. Just as oil was massively overpriced at the peak in 2008. Right? In hindsight we know this to be true.

Once you determine the relationship between the two, you have to look at fundamentals to decide which commodity you think is going to move. For example, when oil prices peaked in 2008, and the ratio was an anemic 6, one of three things could have happened to bring the ratio back to 15.4.

Oil could have stayed at $147 a barrel, and gold could have climbed to $2,264 an ounce.

Gold could have stayed at about $885 an ounce, and oil could have fallen to $57.50 a barrel.

Oil could have fallen as gold climbed.

Each of these three scenarios would mean very different investments.

That's why the Gold-Oil ratio is a tool, a barometer of sorts.

With the ratio at just about 15, fundamentals are more important for direction in each commodity, and I'm thinking that if oil supply is not disrupted by the uprisings in the Middle East and North Africa, then we could likely see prices fall back below $90 a barrel.

That said, investors will look to gold during this time as a place of safety for their money -- but perhaps not to the tune of "a few additional barrels of oil."

In other words, we could see gold climb, but not in a significant manner in the immediate future... And we could see oil prices fall, but not so far as to make oil seem underpriced.

There were eight of us in the room. Jerry (the CEO), five of his VPs, Bernadette ( Jerry's personal assistant), and me.

"We are here to solve a problem," Jerry told the group. "The advertising campaign that has paid all our salaries these past three years has stopped working. Response rates are down by 30%. And the average order is down too.

"If we were making big margins, we could take a few months to solve this problem. But we have a 10% profit business. That means I need some good ideas - no, great ideas - and today!"

Jerry was, as you can see, blunt. But he was right about two things:

When a business has a small profit margin (his was making about a half million on $5 million in sales), it can't sustain a prolonged period of weak marketing results.

And when a marketing campaign stops working, good ideas won't fix it. You need great ideas.

A sense of urgency permeated the conversation. Everyone knew his job was on the line.

"I've invited Michael to help us drum up some new ideas," Jerry said. "To help us think outside the box."

I started the brainstorming session by asking why the original strategy had stopped working. I wasn't really interested in their ideas at that point. I wanted to see how this group interacted: who were the idea people, who were the cheerleaders, who were the naysayers, etc.

Every business has its own personality. Some are open and non-hierarchical. Others are closed or traditional. Whatever the culture, there are unspoken rules about who is allowed to come up with ideas and when.

After listening to the executives talk for less than five minutes, I could see that in Jerry's business the atmosphere was informal but only two people were "allowed" to make suggestions: Jerry or Lewis, one of the VPs. Everyone else played a support position.

I knew that this was a big problem. But I also knew that confronting Jerry about it was not the solution.

Instead, I used a protocol I often use to break up "invisible" corporate power structures. I announced that from that point forward I would ask them questions, but they couldn't discuss them. They could simply write their answers down on index cards and hand them to me. And then I would read those answers out loud, without saying who had written them.

I asked about all sorts of things, from changing the name of the product to changing its USP to using celebrity endorsements, etc.

During the first hour or so, I noticed several things. The first thing I noticed was that Jerry and Lewis came up with the best ideas. But their ideas were versions of ideas the company had been using for three years. None of them would make a significant difference in their marketing results.

The other thing I noticed was that the answers from the other participants ranged from not so good to terrible. At first, the worst ideas came, not surprisingly, from Bernadette (who had no experience marketing). But the ideas of the disenfranchised group started getting better while the ideas generated by Jerry and Lewis stayed pretty much the same.

By breaking down the old power structure, we were able to get some exciting new ideas up on the board. Initially, Jerry and Lewis had a tough time accepting the possibility that other people could come up with anything worthwhile. But as the session went on and we started refining the new ideas, everyone became more excited about the genuine prospect of turning the business around. The apprehension that was dominant at the beginning of the meeting was replaced by optimism and eagerness.

At the end of the day, we reviewed all of the ideas that we liked, took a vote, and came up with three that we thought would make the biggest difference.

One of them had to do with media placement. Another had to do with pricing. And the third was an idea about the product guarantee.

All three had originally come from Bernadette. When I pointed that out, everyone was amazed, Bernadette most of all.

"I never thought of myself as an idea person," she said.

"Well, you'll have to change the way you think, won't you?" I replied.

Jerry tested Bernadette's ideas the following month. Two of the three worked very well. Their advertising resumed its former power and the business actually increased its profit margin that year.

More important, Bernadette was soon promoted to marketing assistant. And three years later, she was making six figures as a marketing VP.

This little story illustrates three observations I have made about idea generators and the roles they play in entrepreneurial businesses:

In every company, there is an invisible culture that separates the idea generators from everyone else.

When it comes to ideas, Pareto's Law rules. The idea generators represent fewer than 20% of a company's employees and yet they generate more than 80% of the ideas.

The idea generators make much more money than the average employee. I don't have any figures on this, but my guess is that they make between two and 10 times the average salary.

The conclusion?

If you are not an idea generator in your company now, become one.

You will have more fun. You will enjoy more power. And you will make more money. Lots more money.

If you are thinking, "Gee, I can't do that. I'm not the creative type," remember Bernadette. Neither of the two great ideas that Bernadette came up with was creative in the traditional sense. (One was: "What would happen if we raised the price?" The other was: "Do you think we can sell this to doctors and dentists?")

The point is that many of the best ideas are not clever. They are obvious ideas that, for whatever reason, no one has thought of (or dared to suggest) before.

Also notice that Bernadette's ideas were posed as questions. Great ideas don't have to be pronouncements from marketing mavens on Mount Olympus. They can just as well be questions from ordinary people who are looking at the business with fresh eyes.

Two of the best idea generators I ever worked with understood this. Jay Abraham was one of them. I can't remember the last name of the other guy, but let's call him Ted Stevens.

Jay and Ted had similar methods. When asked to come up with ideas, they began by asking all sorts of fundamental questions. Questions like "Why are you selling this investment publication to investors?" and "Why do you think that people in debt don't have a lot of money in the bank?"

You'd think there'd be no need to ask such questions - that the answers are self-evident. But Jay and Ted understood the principle I just mentioned: that many of the best ideas are the most obvious. They knew, too, that in most business cultures, the simplest questions are never asked because the idea generators in power have already decided they are stupid.

Another thing about Jay and Ted is how unattached they were to the suggestions they made. (I have written about the dangers of ego attachment several times. It is a major hindrance in creativity.)

They might ask, for example, "Why don't you try to sell your investment publications to health buyers?" And if you'd say that you'd already tried that, they'd just move on to their next question. They didn't try to argue their point. They felt "free" to keep the conversation moving.

Think about Bernadette. She didn't consider herself to be a creative person. Therefore, she wasn't hampered by any sort of ego attachment. She posed her ideas as questions - and if they weren't accepted, it didn't bother her. When it turned out that she had come up with the three best ideas that day, she was thrilled. But she didn't expect it.

That's the mentality of a great idea generator. He sees the process itself as fun. A successful outcome is great, but it's a bonus.

Getting Your Foot in the Idea-Generating Door

Developing the skill of generating good ideas is not dissimilar from developing any skill. Initially, you're not going to be very good at it. But if you're willing to keep practicing, you'll get better and better. (See my essays on competence and mastery.)

You start with a single idea, posed as a question, and then go on to the next one. Don't worry about whether your ideas are accepted or put into action. Your goal is an internal one: to become more skillful. The outcome, at this point, is a secondary consideration.

Of course, as I said, there are usually unspoken rules in any corporate culture about who is allowed to come up with ideas and when. So how do you break through the invisible power structure in your company in order to get your suggestions even listened to?

Here's what I recommend...

Identify a business problem - any problem, it doesn't matter what it is.

Think of the problem from the customer's point of view - i.e., how this problem affects him.

Then pose this question: "In an ideal world, what would the perfect customer experience be?"

Follow that up with a bunch of suggestions in the form of questions (the simpler the better). Put them down in a memo and send that memo to the person in charge of fixing the problem.

Don't expect to be thanked for your effort. Don't even expect to get a reply. Explain in your memo that you were thinking about the problem and hoped your questions could provoke some solution. Leave it at that.

Then, a week or so later, identify another problem and follow the same process.

You'll notice that each time you send out a new memo, your suggestions will be stronger than they were the time before.

Make it a rule to save all your memos. Sooner or later, you will see that your ideas are being put forward to management - and that some of them have even been implemented.

When that happens, send a note to the person who implemented your idea successfully and congratulate him on "finding a great solution for the problem." Your note should include your original memo. (He very well may have forgotten it.) Don't claim credit. Give credit. That's how you win friends and influence people.

Keep your notes humble. The idea is to get these people see you as someone who can help them.

Eventually, your status in the company will start to change. You will be occasionally asked to contribute ideas. You haven't been let into the club yet, but you are an adjunct idea generator now.

Keep at it until one of your ideas is a big hit - i.e., it makes the company lots of money. Now you are in position to do a little pushing. It shouldn't take much if you are in a good, growing company. Your boss will know the value you are bringing to the table. He will see you as someone who can help him accomplish his goals. He will want to promote you.

Welcome to the club!

Maintaining Your Position As a Problem-Solving Genius

Once you are in the club, you will be called on constantly to solve all kinds of problems. The more serious the problem, the more pressure you will feel.

Don't be cowed.

Coming up with a continuous stream of great ideas isn't easy. But it can be done.

Basically, there are three big problems that every business has to deal with:

1 Bringing in new customers.

Creating vertical, back-end sales to boost profits.

Improving product quality to ensure customer retention.

Each of these demands a different approach.

1. Generating ideas to bring in new customers.

To come up with new selling ideas, you have to become a student not only of your own selling strategies but also of the selling strategies of your competitors.

When I consult with a business, I make it a policy to study every advertising campaign they have done in recent years - how it performed, what kind of customers it brought in, how much they spent, how much they refunded, etc. I do the same thing with their primary competitors. In the process, I begin to see the invisible links that support the most successful efforts. And ideas come to me. I wonder what would happen, for example, if one company used the pricing strategy of another but with the copy approach of a third company.

2. Generating ideas to create vertical, back-end sales.

When brainstorming possible back-end products, I focus on the initial advertising campaign - and try to understand what, exactly, customers responded to. Were they interested in something that allowed them to work more productively? Or did they want a product that would project a certain image - powerful, professional, or creative?

Once I've discovered the foundation of those initial sales, I have a psychological basis on which to create many back-end products.

I begin with the premise that what a customer bought once he'll buy a second time. And what he bought a second time he'll buy again. So, I create back-end products that have the same basic appeal as the lead-generating product but are different in respect to other factors: pricing, packaging, size, quantity, frequency, etc.

For example, a book that promises to make the customer feel better about himself can be repackaged as:

a $79 audiocassette program

or a $599 home-study course

or a $1,950 two-day seminar

By constructing a simple grid with different prices along one axis and different packaging formats along the other, you can often come up with a dozen or more good back-end product ideas in a single sitting.

3. Generating ideas to improve product quality.

Coming up with good ideas for improving your products is relatively easy. All you need to do is ask.

Ask your customers by phoning them, writing them, e-mailing them, and surveying them. Keep in mind that sometimes they will give you answers that they think are "good answers" rather than truthful answers. So read between the lines. But if you ask them, they will tell you.

Ask your customer-service people, too - as many as you can. They understand the major gripes, nagging issues, and market trends that influence your customers' decisions to buy (or not to buy).

And ask the people who make the product, especially those on the manufacturing line. Ask, "What is are the three best things about this product?" and "What are the three worst things about this product?" What they say might astonish you - but also inspire you.

An idea must be important enough to inspire followers, useful enough to create benefits (for your customers, your employees, and yourself), and cost effective. And, ultimately, it must be right. There is nothing so dispiriting and financially damaging as a Big Idea that changes systems, drains resources, taxes everyone's patience, and then falls flat on its face.

No wonder so few people are even willing to try.

But by doing your homework in these three critical areas - front-end sales, back-end development, and product improvement - a constant stream of good ideas will keep popping into your head. And you may very well find yourself the main idea person in your company... with a title and salary that proclaims your status to the world.

Teachers and Students

In the old days, parents trusted teachers to teach. When I was a kid, for example, teachers felt free to slap us around if we got out of line. I would have never thought to complain about it. I knew I deserved what I got and I only hoped my parents wouldn't find out what I'd done.

These days, teachers don't have the right to punish kids physically. And that may be a good thing. But I wonder sometimes if the pendulum hasn't swung too far the other way. I know some younger parents who have so little trust in their children's teachers that they argue about the homework their kids get, the pedagogy they use, and even the grades they receive.

They have the same attitude about their children's sporting activities: "Why isn't my Johnny pitching for the team? He wants to be a pitcher!"

Friday, February 25, 2011

The Mysterious Origins of American Money

“There are mysteries connected with the birth of this republic.” – Charles A. L. TottenThe American dollar bill is a common object, crossing our palms so frequently in fact, that it may never get the closer attention and inspection it deserves. Stop reading for a moment, and go grab a dollar bill, so that you can follow along while we take a deeper look at some intricate images and explore the hidden symbolism you are holding in your hand.The Great Seals
In 1935, Franklin D. Roosevelt ordered the design of a new American dollar bill, in which he instructed that the Great Seal of the United States be incorporated. Not surprisingly, the designers were Freemasons, which explains the Masonic symbolism that was carefully incorporated into the design process.
The great pyramid with the all-seeing eye (or the Eye of Providence) represents the left eye. According to Egyptian beliefs, the left eye is linked with the moon and intuition. This pyramid is crafted from a total of 72 complete bricks, a sacred Masonic number, as there are 72 ways of pronouncing and calling upon God. In the Masonic studies, 72 was understood to be the rate of procession of the sun, at a rate of one degree every 72 years. This mysterious pyramid, a unique and well recognized Masonic symbol, suggests that the building of the pyramid will be completed with the assistance of an all-seeing God.
This message is further conveyed in the national motto “In God We Trust,” seen above the word “ONE.” At the base of the pyramid are the Roman numerals MDCCLXXVI, translating to 1776, the year when the United States was founded by the thirteen colonies, implying that the US is akin to the building of “the pyramid.”Mottos
In the seal on the left, containing the great pyramid, is the Latin phrase “Annuit Coeptis,” a famous writing from a Roman poet, in which a prayer is made to the God Jupiter. This phrase translates into “He favors our undertaking.” The Latin phrase “Novus Ordo Seclorum,” also seen beneath the pyramid, translates to “a new order of the ages,” a phrase which represents the prophecy of the second coming of Christ.
On the ribbon above the Eagle in the seal on the right is the Latin phrase, “E pluribus unum,” which translates to “Out of many, the one.”
The only motto in English is the national motto, “In God We Trust,” as seen above the bold “ONE” on the back center of the bill.George Washington
Ever wonder if there is something to George Washington’s pursed lips, which almost appear as if he is frowning? When this portrait was commissioned, Washington had recently been fitted with a new set of false teeth. Posing for the portrait, under intense pain and swelling, the result was this tight-lipped expression.
The oval frame around the portrait of Washington is in fact the Greek letter Omega, the final letter of the Greek alphabet, which was later adopted by Christians as a symbol of “the end.” This portrait and framework suggest that Washington’s spirit is guiding the destiny of America.
The eye of Washington is placed in the exact center of the bill, mimicking the image of the all seeing eye on the back of the bill. Was this placement meant to suggest that Washington should be honored as a God?Stars
On the front on the bill, within the green seal on the right, identified as The “Department of the Treasury,” are thirteen stars, which were referred to as “constellations” by the Masonic designers. The idea of thirteen may have also derived from an older version of the U.S. flag, which contained thirteen stars, and thirteen stripes. These thirteen stars, which separate the images of a scale and key, are to be interpreted as “balance is key.”
On the back of the bill are thirteen more stars, found above the head of the eagle within the Great Seal. Upon closer inspection, you will see that these thirteen stars form one large six pointed star, also known as the Seal of Solomon or the Star of David.The Number 13
- 13 letters in the motto “E pluribus unum”
- 13 stars, or constellations
- 13 leaves on the olive branch in the Great Seal in the claw of the Eagle
- 13 arrows in the Great Seal in the claw of the Eagle
- 13 vertical, and 13 horizontal divisions on the shield on the Eagle
Are you amazed? Keep in mind that this is just some of the symbolism on the surface, visible to the eye. There is even more information and mystery if you choose to deepen your knowledge on this subject. The Internet will be a great resource for you. Once you have had a chance to inspect some of these mysterious, symbolic, and down-right fascinating images yourself, you’ll realize that the common American dollar bill is worth a lot more that its monetary value!

Did you know there's a way you can make more money by NOT investing in stocks, bonds or mutual funds? In fact in the special video presentation below, I'll tell you how it is possible to turn every dollar you own into $10.92 with as little risk as possible. You also might be surprised to learn that the special investment I reveal in this video is responsible for turning average people into millionaires... even billionaires. You'll hear the incredible rags-to-riches story of three people who had very little money to their name, yet became millionaires using this one special strategy. The details are in the video below. I encourage you to listen to it in its entirety. You'll be surprised how you can use the same strategy to make your own fortune.

Wednesday, February 23, 2011

Dr. Rusty McDougal first warned me about GLD last year. (GLD is the exchange-traded fund that uses shareholder money to buy an equivalent amount of gold, minus expenses.) Rusty is a gold bug. But he doesn't like GLD. He doesn't think it has the gold it claims to have. And he says it's in cahoots with the big banks and gold traders who manipulate gold prices.
"If you want gold, why would you buy 'paper gold'?" he asked me.
I'm going to answer that question here. (And it's probably not what you expect.)
But first... confession time. I own gold, but I'm no gold bug. I've never invested in GLD. But I've always liked the idea behind it: It provides a way to own gold without the hassles of storing it, transporting it, and keeping it secure.
After talking to Rusty, I did a little research. And I quickly found out that his opinion of GLD is shared by many other gold followers. GLD, they say, is also guilty of many other sins Rusty didn't mention. They don't insure their gold. They don't keep track of their gold. They don't audit their gold. They allow their gold (bought by GLD shareholders) to be leased by their gold "handlers." And they operate behind closed doors.
You're getting the picture, right? The bottom line? Many folks think that GLD cannot be trusted. And it certainly doesn't deserve your money.
But if GLD is playing games with its customers, it's the best-run scam I've ever come across. Either that or it is what it says it is: a convenient way to invest in gold if you don't mind never seeing or touching the metal you're buying.
Sorry, but I'm not buying into the idea that GLD, together with the big banks, is bilking investors out of their hard-earned cash. First off, everyone and his mother would have to be in on the conspiracy. (Here's the short list: GLD, HSBC Bank, Federal Reserve Bank of New York, Federal Deposit Insurance Corporation, UK Financial Services Authority, London Bullion Market Association (LBMA), Bank of England, Brinks Ltd., Citigroup, Goldman Sachs, J.P. Morgan, UBS Securities, Morgan Stanley & Co., and Deloitte & Touche.) And that just doesn't make sense.
Surely there are easier ways to manipulate the price of gold than to prop up one of the biggest and best known ETFs by falsifying dozens of documents, don't you think?
But I have a bigger problem with the case against GLD.

False Accusations

The accusations simply do NOT hold up.
Except for one, that is – and it's something that GLD readily admits...
The say, upfront, that they won't deal with you directly if you want to exchange your shares for gold. You have to do it through your broker.
So buying GLD shares isn't the same as buying gold. If that's a deal breaker for you, you don't have to read any further. You know all you need to know about GLD.
But if you're still interested, the question remains, is it worth investing in GLD?
I say absolutely yes. Because you get two big benefits.
For openers, you get to jump off the dollar-debasement train. President Nixon took us off the gold standard in 1971. And if you want to go back to the good ol' pre-Nixon days of a gold-backed currency, there's really only one way to do it. Buy GLD shares. They're fully backed by gold. While the dollar goes down, your shares of GLD go up right in step with gold...

6 months +13.29% (London spot price +13.52%)

1 year +22.56% (London spot price +23.04%)

Since inception (to month end) +18.91% (London spot price +19.38%)

The other benefit?
GLD gives you a nice hedge against stock market drops. It often goes in the opposite direction.

As I said, GLD's purported shortcomings do NOT hold up under close scrutiny. After poring over GLD's prospectus and the dozens of documents on its website, and asking some hard questions of GLD's Brian M., this is what I've learned:

Quality of Gold? Not an issue. GLD's custodian, HSBC, must hold gold "at least a minimum fineness (or purity) of 995 parts per 1,000 (99.5%) and otherwise conform to the rules, regulations, practices, and customs of the LBMA, including the specifications for a London Good Delivery Bar. A London Good Delivery Bar must also bear the stamp of one of the melters and assayers who are on the LBMA approved list."

No Auditing? No way. GLD's trustee, New York Mellon Bank, audits GLD's gold holdings in London twice a year. Plus, Deloitte & Touche, GLD's financial auditor, visits the vaults before signing off on its annual audits.

Unauthorized Gold Leasing? No opportunity to do it. All of GLD's gold is allocated to specific accounts except when it's being transferred in and out of the trust. Or when small amounts of gold (can't be more than 430 ounces) are left over at the end of the day. The opportunity for the fund's gold handlers to lease this gold is extremely limited. What's more, HSBC updates its records at the end of each business day to identify the specific bars of gold allocated to GLD and details all the gold transfers in and out of GLD.

Illegal Fractional Banking? Simply not true. The value of GLD's gold as of last Friday is $53,823,000 (39,430,988.237 ounces x $1,365.00 per ounce). The value of their total shares is $53,818,000 (404.10 million shares x $133.18 per share).

When it comes to GLD, the naysayers have an overactive imagination. But their criticisms are not just exaggerated. They have no factual basis. They're right on only one point. You can't redeem gold for the underlying bullion GLD holds. But that's nothing new in the ETF world. It's how ETFs are constructed. Go ahead and try to redeem your DIAMONDS shares for the underlying Dow Jones stocks. You can't, of course.
So if you hanker after physical gold, GLD is not for you.
But the rest of you need to know that GLD is no scam. In fact, it's a solidly constructed and well-run ETF. And it's as transparent as, if not more transparent than, any other ETF I know.
You have a choice. You could wait for the government to put our shaky currency back on the gold standard. (And you will be waiting a very, very long time.) Or you could trade in your degrading dollars right now for GLD paper fully backed by gold. If you would trust a gold-backed dollar, you should be able to trust GLD. That's what GLD is, a "gold-backed currency" writ small.
Bottom line? GLD can be trusted. And it has done everything it can to deserve your hard-earned money.
The price of gold is heading up. Isn't it nice to know that you have a hassle-free, safe, and effective way to take advantage of that?

"Wealth, like happiness, is never attained when sought after directly. It comes as a by-product of providing a useful service."

Henry Ford

In my recent essays in ETR on starting your own import-export business, I've focused on the business-to-consumer track. You find suppliers and manufacturers, buy their products for pennies on the dollar, and resell them online to customers in the U.S. (or Europe, South America... wherever you live) at a huge mark-up.
But there is another approach to the import-export game that can be just as - if not more - lucrative: supplying imported products to retailers.
There are an estimated 3.7 million retail gift stores in the United States and Canada, according to InfoUSA - a fraction of the 175 million consumers online. But because each order to these stores will be in the dozens, you could make more money from one deal than from a whole year of selling to individuals. Your initial investment will be higher. But we'll show you ways to make it as low as possible.
To get an idea of how a business like this might look, check out the story of Kole Imports (www.koleimports.com). The company was started by two brothers in 1982. They sold car stereos and tools at flea markets. Before long, they decided to import the merchandise themselves to save money - and soon realized that becoming wholesalers could be very profitable. Taking advantage of the boom in dollar stores across the country, they quickly became one of the top suppliers to discounters in the U.S.
Revenue figures aren't available for this private company, but it's estimated they make more than $50 million annually.
Now you won't become a supplier to Walmart or Dollar Tree - at least not right away. The scale of those businesses is just too large for a first-time importer. And it would take some time to reach the level of Kole Imports.

But there are plenty of small and medium-sized retailers out there that you can deal with. Think of non-chain dollar stores, shopping mall outposts specializing in low-cost goods, and so on.

For example, there is a small gift shop a few blocks from my house that sells cheap jewelry, kids' toys, women's clothing, and more. That's the kind of place you would target.
Initially, they might not be receptive to your offer. After all, they have established relationships with other suppliers. But business is business. So they will be receptive to you... if you show them you can save them money by bringing in the products they want at lower prices.
They will tell you which products they are interested in. You then go to Alibaba.com and find the manufacturer with the best price on those products. You get a quote from the manufacturer and submit it to the retailer. As the "broker" in the deal, you take home a percentage.
Every retailer will have different needs, of course. But out of the estimated 22,000 products on discount store shelves, some are hotter than others. These include:

Pet toys

Plastic cups

Cell phone accessories

Birthday party supplies

Balloons

Office supplies

Cleaning products

It may not be glamorous to supply basic items like these to retailers, but the market wants what it wants. And if you can meet your market's needs, the opportunity to make money is there...

Tuesday, February 22, 2011

Interested in starting your own business in the lucrative import-export market?
One route is to sell directly to consumers online. But there is a potentially more lucrative alternative.
As a "middle man," you link overseas manufacturers with retailers in your area... or nationwide.
Any small to medium-sized retailer should be open to doing business with you. But you have to give them the best price. And you need access to the products their customers want.
Both requirements are easy to fulfill.
Marc Charles, the creator of the China Wholesale Trader program, uses 100% cotton T-shirts as an example. (Because, if you think about it, most stores sell some sort of T-shirt.)
So let's walk through the process of brokering a deal with T-shirts.
The first step is to research potential buyers for imported T-shirts.
Think about stores in your neighborhood. Look in the phone book. Search online. Write down contact information for as many local retailers as you can find that sell cotton T-shirts.

For retailers outside your area, go to RetailNet (www.retailnet.com). It's huge database of all the retailers in the U.S., including big players like The Gap and Foot Locker. But your focus will be on the small and medium-sized businesses. Yes, you will have to pay for some of this information. But it's worth it to find good contacts. Retail Industry (www.retailindustry.com) and Retail Forward (www.retailforward.com) are also good sources.
On RetailNet, look under the "apparel" category on the left side of the home page. Once you're there, look at the latest headlines and some of the paid databases to find 5-10 retailers you would like to contact.
Call or e-mail the stores. Get in touch with their purchasing managers, if you can. Ask if they're open to receiving a wholesale price list. You're going to get some "no's." But many will say yes. Remember, they're all about the bottom line. And if they can get a better price through you, they'll work with you.
You might also consider contacting some direct-mail list brokers that specialize in retail business owners. Rent the lists - it can be quite cost-effective. And send out a letter introducing yourself and your services. Include your phone number and/or e-mail so they can get in touch with you.
Your next step is to go to Alibaba.com. That's the site where you'll find the T-shirt manufacturers - many of them in China. Just type "cotton T-shirts" in the search box. You'll find thousands of companies that can fill your needs. Narrow it down to the top 10. And then ask each one to send you a quote for 5,000 cotton T-shirts.

The Most Powerful Business-Generating Website in the World!

Huge corporations have been taking advantage of China's ridiculously low wholesale prices for years to reap huge profits.
They source products from China for super, super cheap prices... then resell those products in North America at a hefty mark-up...
AND SO CAN YOU!
That's right.
Thanks to the Internet... YOU can do what the "big bad corporations" are doing.
All you need is a computer and an Internet connection... and the right guidance... and you can have a shot at the same kind of profits.
Now you pass on that information to the retailers who asked for your wholesale price list. But first, you add 10% to 15% to the prices you got from the manufacturers. That's your cut for brokering the deal.
Here's the way your final agreement with both parties might look (an example I took from Marc's program):

Finish Line Inc. agrees to purchase 15,000 100% cotton T-shirts from [your company] at $1.95 each, plus shipping ($4,200), for a total of $33,450. This amount includes all taxes, fees, and insurance.
ABC Export Company in China agrees to export 15,000 100% cotton T-shirts to Finish Line Inc. [your client] for $1.25 each, plus shipping ($4,200), for a total of $22,950.
When this deal is completed, your profit would be $10,500!

In his program, Marc explains exactly how to approach the retail business owners. And how to negotiate to get the best deal from both your suppliers and the stores you're selling to. He even includes a template you can use when contacting business owners by mail.
Yes, your upfront investment can be a bit steep. But brokering these deals can be a very lucrative. And the market and opportunity for growth is huge.
The United States is a nation of consumers. We love to buy things. And no matter how bad the economy gets, that won't fundamentally change. People will just buy cheaper stuff. And that's where you come in.